The British Pound is in the spotlight today after Bank of England governor Mark Carney indicated that it’s too early to expect a rate hike from BoE. Meanwhile, AUD and NZD rise on better data and improving moods.
The pound fell after the Bank of England governor said he did not think that now was the time for interest rates to rise. Mark Carney’s comments came in his Mansion House speech, and sterling fell 0.4%in response. Overall, the message could be considered clearly negative for GBP. What’s more, some rumours indicated that a rating cut is likely from the S&P, which added to pound’s weakness. With some live on the greenback the pair could be bound to test a lower limit in a recent consolidation and a break lower could pave the way towards 1.25. Do notice that despite a loss of majority for the Tories, the pair is yet to test a local low of 1.2515 from before the elections announcement.
Asian session on Tuesday was relatively benign with limited moves on G10 currencies. NZD is once again a winner as more data from domestic economy suggest a robust growth. AUD is gaining slightly after a release of the RBA minutes. Japanese Nikkei225 (JAP225) rallied nearly 1% after a record close on Wall Street yesterday but the Chinese markets were slightly under water and Australia declined as well.
The Australian dollar has been thriving since the beginning of June what has been partially reflected by a weakness of the US dollar. Moreover, there was quite an impressive jobs report revealed last week which showed a falling jobless rate and a creeping up labor force participation rate at the same time. That’s really upbeat mix regarding an assessment of the jobs market. That is why the Goldman Sachs expect a rate hike from the RBA relatively soon.
US indices marked a pretty stellar session yesterday with the NASDAQ (US100 on xStation5) leading gains. The technological index rose by as much as 1.42%. Moreover, the S&P500 (US500) climbed by 0.83% while the Dow Jones (US30) rose by 0.68%. These upbeat moods impacted Asian indices as well which, in turn, affected the opening on European bourses.
One could say that this week is decisively dominated by central banks’ speakers. We got first remarks from FED’s Dudley yesterday which shored up the greenback and US yields as well. There are even more speeches today not just from the Federal Reserve.